Inbound Logistics | January 2022

(continued from p. 132)

anticipated demand. “When the brand knows it will have a severe spike, we can partner and distribute the inventory appropriately so that no one site has to ship 300,000 orders overnight,” Evert says. Outsourcing surge fulllment makes sense for other types of situations, too. “We’re not saying outsource your entire fulllment,” she adds. “This is a way to respond to the dynamic situation we’re all experiencing. Don’t make it harder by trying to do all of this yourself.”

Third-party logistics provider Flexe encourages clients to avoid overwhelming warehouses during an order spike by outsourcing fulfillment.


That’s what one of Pat Fitzpatrick’s outdoor action sports clients does. “A small warehouse keeps enough inventory for three to four days, but pushes everything out to stores for fulllment,” says Fitzpatrick, vice president of sales and marketing for commercial storage solutions company McMurray Stern. Companies can use this approach strategically according to demand locations, he says, or to improve delivery times in areas farther from a fulllment center but closer to a store. RAMP UP REVERSE LOGISTICS. Graham sees an increased focus on reverse logistics. “As we think about spikes in volume and limited inventory, retailers are looking at returns and asking, ‘How do we get them inspected and back to sale quickly?’” he says. Micro-fulllment makes that easier. “If you take returns in the store, you can get the product back into inventory much quicker,” Fitzpatrick says. CARRY MORE INVENTORY THAN YOU’D LIKE. Many retailers have gone from “just in time” inventory management to “just in case,” stocking excess inventory of products most likely to benet from a demand surge. “The volatility and unavailability of some products has led retailers and

consumer packaged goods companies to emphasize inventory over anything else,” says Zimmerman. “They want more to sell and they will pay extra for it and store more of it.” Short-term warehouse space marketplace Chunker helps companies do that by connecting them with temporary surge storage capacity. Operating like “an Airbnb for warehouse space,” Chunker provides a buffer that lets retailers and brands stock up on inventory without committing to a long-term lease. “Warehouse space comes with risk when companies have to sign a lease,” says CEO Brad Wright. “Shorter-term, more agile storage lets them ex their storage up and down.” LET GO OF BEST PRACTICES. Increasing inventory carrying costs and other recent survival strategies are counter to pre-pandemic best practices. “But perfection is not the goal here,” says Evert. She recommends being thoughtful about what you can do to increase the chance that the product will get to the consumer. When the best practice approach isn’t an option, consider alternatives. “Without that, you’re losing demand,” she says. “In the worst case, you fail to realize you have to move faster and to save pennies, you lose the whole sale.” n

Increasingly, retailers looking for ways to get high-demand orders to customers more quickly are using a micro-fulllment model that involves lling orders from the back of brick-and- mortar stores.

Some retailers with a strong brick-and- mortar presence handled demand surge fulfillment from increasingly sophisticated micro-fulfillment, back-of-the-store operations.

136 Inbound Logistics • January 2022

Powered by